KUALA LUMPUR: SapuraKencana Petroleum Bhd has won a tender to buy United States-based Newfield Exploration Co's oil and gas assets in Malaysia for about RM2.85 billion.
SapuraKencana was picked to buy all interests in Newfield Malaysia Holdings after a thorough and rigorous bidding exercise involving more than 40 companies, the American company said in a statement yesterday.
Newfield is the fourth largest oil and gas producer in Malaysia, with interests in nine production sharing contract (PSC) blocks spread between the oil-producing region of Peninsular Malaysia and the gas-producing regions of Sarawak and Sabah.
Its total oil and gas portfolio in Malaysia comprises 3.3 million net acres.
It was reported that the assets turned in some US$400 million in pre-tax profit for the company last year.
The agreement is subject to the approval of Petroliam Nasional Bhd (Petronas) under the applicable PSCs, SapuraKencana shareholders' approval and customary closing conditions.
"We have enjoyed significant success in Malaysia and had a great business partnership with Petronas in the region," said Newfield chairman, president and chief executive officer Lee K. Boothby.
"In early 2013, however, we had announced our intention to exit our international businesses and focus on domestic resource plays. "Our year-to-date results build positive momentum and confidence in our ability to deliver on our three-year plan," he added.
Meanwhile, SapuraKencana said the deal will enable it to gain an immediate foothold and recognition as an upstream resource owner and operator of current estimated production of 23,000 barrels of oil daily, among others.
"The acquisition will further strengthen and diversify the company's existing business portfolio," it told Bursa Malaysia.
The deal is expected to be completed early next year.